Your money in 2022: Personal finance trends to keep an eye on this year
What personal finance trends are likely to shape 2022?
New research shared with City PM looks at the sentiment and behaviours for this year.
The pandemic, mixed with wider economic issues and the rising cost of living, appears to have had an effect on Brits’ relationship with money, because the findings from consumer research platform Attest clearly indicate that Brits are watching their pounds and pennies this year.
Most Brits are likely to say they’re spending ‘fairly cautiously’ (31 per cent), while 11 per cent are spending ‘very cautiously’ – that’s 42 per cent of people who are sticking to a strict budget.
But frugalness doesn’t apply to everyone; over a quarter of consumers (28 per cent) are spending ‘freely’.
There are also generational differences in how younger people and older people are spending.
Gen Z are more than three times as likely as Boomers to say they’re spending ‘very freely’ (11 per cent versus 3 per cent) and twice as likely to describe themselves as spending as ‘freely’ (29 per cent versus 14 per cent).
Nation of savers
With many Brits planning to count their pennies in 2022, 86% say they are putting cash aside each month for a rainy day, although not necessarily that much of it.
Of Britain’s savers, the single largest percentage of people (14 per cent) save between £26- £50 per month, but one in ten (10 per cent) save more than £250 each month.
By contrast, previous Attest research from 2019 revealed that 22 per cent of Brits reported having no savings.
The new research highlights that just 14 per cent of consumers are not saving on a monthly basis, indicating that people are more likely to be putting money aside post-Covid.
Boomers are the group most likely to not save at all; 21 per cent versus 17 per cent of Gen X, 10 per cent of Millennials and 6 per cent of Gen Z. So it appears that even though younger people are spending more freely than their older counterparts, they’re also saving more.
What people want to spend their money on
Following the busy and often expensive Christmas season, Brits are saving for vacations (32 per cent), with Boomers especially setting their hearts on a trip (34 per cent).
Another sector that looks set to benefit is home improvements; just under 20 per cent of Brits are saving up to make updates to their homes. This sees the continuation of the DIY trend sparked by 2020’s stay-at-home orders.
In terms of big-ticket items, people are as likely to be saving for a mortgage deposit as a new vehicle (both at 12 per cent).
“Many consumers are being extra cautious with their finances as we enter this new year.,” stressed Jeremy King, CEO and Founder of Attest.
“The ongoing pandemic, mixed with an uncertain economic outlook seems to have driven people to focus on building up a rainy day fund to protect themselves from any unexpected events in 2022,” he noted.